#2021-25 September 17, 2021

Governor Baker Criticizes Income Surtax Proposal

In comments on a local radio program this week, Governor Charlie Baker criticized the proposed income surtax on wealthy households set to go before voters next year, questioning how much money the idea would generate and what those revenues might be spent on.  The Governor also said that he is not reconsidering his opposition to the proposal, cautioning that its passage could prompt high-income residents or businesses to leave Massachusetts and questioning whether it could earmark revenue for transportation and education needs as supporters intend.

As we have reported previously, the proposed constitutional amendment imposes a 4 percent surtax on annual household income over $1 million.  The proposal states that “to provide the resources for quality public education and affordable public colleges and universities, and for the repair and maintenance of roads, bridges and public transportation, all revenues received in accordance with this paragraph shall be expended, subject to appropriation, only for these purposes.”

Proponents estimated in 2015 that the amendment could bring in as much as $2 billion per year, providing a sizeable influx of revenue into the nearly $50 billion state budget.  Governor Baker however contended that the question would not direct half of the surtax’s revenue to transportation and half to education, noting that the funding would become “general appropriation money that people can spend on whatever they want.”  He also referenced the Supreme Judicial Court's ruling in 2018 that spiked a previous version of the question from the ballot because it improperly combined proposals to implement a graduated income tax and to direct spending toward education and transportation.

Both supporters and opponents say the current proposed constitutional amendment will not be subject to the same kind of legal challenges this cycle because it reached the ballot through the legislative process, rather than as a citizen-sponsored constitutional amendment.

Division of Banks Files Final Student Loan Servicer Regulations

Earlier this week, the Division of Banks announced the filing of final amendments to 209 CMR 18.00: Conduct of the Business of Debt Collectors, Student Loan Servicers, and Third-Party Loan Servicers and 209 CMR 48.00: Licensee Record Keeping.  As previously reported, the Division had filed Emergency Regulations effective July 1, 2021 to implement the student loan servicer licensure provisions set forth in Chapter 358 of the Acts of 2020.  These filings complete the regulatory process for the amendments to these regulations. The final amendments are effective on September 17, 2021.

Copies of the amendments to 209 CMR 18.00 can be accessed by clicking here and copies of the amendments to 209 CMR 48.00 by clicking here.   

FDIC Hosting Session for New Bank Directors on October 28

The FDIC is hosting a virtual session for new bank directors with less than five years’ experience on Thursday, October 28 at 9:00 a.m.  The 90-minute session will focus on fundamental board governance issues, Directors’ roles and responsibilities, the examination process, and effective strategies to monitor bank performance.  There will also be an opportunity for participants to have their questions answered by FDIC staff.  Information to join the Microsoft Teams meeting on October 28 is below.  We encourage banks to share this information with your new directors and those that want a refresher on board responsibilities.

Join on your computer or mobile app 
Click here to join the meeting

Or call in (audio only) 
+1 201-275-0433,,555866199#
Phone Conference ID: 555 866 199#